DOMICILE, IHT and burial


E

Edward Lionheart

Suppose Mr.X has acquired a foreign domicile of choice but for
understandable sentimental reasons expresses the wish to be buried with his
late wife, who happens to be buried in the UK. I understand the taxman, most
unreasonably, might pounce and claim that Mr.X being buried in the UK
indicates that he never really acquired his domicile of choice, and hence
his worldwide estate is subject to UK IHT. Which of the following strategies
would offer the most protection against such an outrageous claim from the
taxman?

1. Mr. X states in his will that he wishes to be buried with his wife in the
UK.
2. Mr. X states in his will that he wishes to be buried with his wife.
3. Mr. X states in his will that he wishes to be buried with his wife,
because he loved her dearly, and not because she happens to be buried in the
UK.
4. Mr. X leaves no instructions in his will regarding burial. The children
exercise their choice to have him buried with the wife in the UK.
5. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children ignore his "wishes" and have him buried with the wife
in the UK.
6. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children exhume their mother and have her re-buried with their
father in his domicile of choice.
 
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E

Edward Lionheart

Edward Lionheart said:
1. Mr. X states in his will that he wishes to be buried with his wife in the
UK.
2. Mr. X states in his will that he wishes to be buried with his wife.
3. Mr. X states in his will that he wishes to be buried with his wife,
because he loved her dearly, and not because she happens to be buried in the
UK.
4. Mr. X leaves no instructions in his will regarding burial. The children
exercise their choice to have him buried with the wife in the UK.
5. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children ignore his "wishes" and have him buried with the wife
in the UK.
6. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children exhume their mother and have her re-buried with their
father in his domicile of choice.
7. A variation on 5. Bury in a foreign field. Blow-off the tax man. Exhume
and re-bury in Blighty with the wife.
8. A variation on 7. Bury heart in foreign field. Rest in Blighty. Or vice
versa.
9. Cremate abroad. Scatter here (shshh!).

Any others?
 
J

Jim Lawton

Suppose Mr.X has acquired a foreign domicile of choice but for
understandable sentimental reasons expresses the wish to be buried with his
late wife, who happens to be buried in the UK. I understand the taxman, most
unreasonably, might pounce and claim that Mr.X being buried in the UK
indicates that he never really acquired his domicile of choice,

Why do you say that? Is there chapter and verse on the web somewhere? It sounds
like b*ll*x to me.

:)

Jim
 
E

Edward Lionheart

wrote: I understand the taxman, most


Why do you say that? Is there chapter and verse on the web somewhere? It sounds
like b*ll*x to me.
It can be disagreeable to change domicility, for essentially it means you
are stating you have the intention never to return to the UK. You will not
be allowed to be buried in the UK when you die and you would also have to
cancel your membership of all UK-based organisations - such as the
much-coveted Marylebone Cricket Club (MCC).
http://money.guardian.co.uk/print/0,3858,4731020-110933,00.html

UK Domicile will be imposed :
If you retain assets in the UK or
If you keep a UK Passport, or
If you keep an interest in a property in the UK (i.e. a house or a holiday
home) or
You even express a wish to be buried in the UK
http://www.pacfinancial.com/articles/volume2_3.html

Change of domicile can be established by ownership and purchase of land,
opening and closing bank accounts, the amount of time spent in each country,
where one wishes to be buried and many other questions.
http://www.ukimmigration.co.uk/DOMICILEPOLYGAMYTALAQISLAMICMARRIAGES.htm

Expatriates have found clarifying domicile with the Revenue an
extraordinarily frustrating business. Exasperation sings loudly when they
are told one thing by advisers and another by the Revenue. Unfortunately, in
many cases, the Revenue will only declare its perception of domicile status
on the death of individual, taking the view that circumstances may change.
An individual could return to the UK after many years spent overseas, for
instance, or express a wish to be buried in the UK.
http://www.expatsdirect.com/ed/index.cfm?scn=featart&ArticleID=10

There have been many who have claimed a foreign domicile only to have
revealed a request that they be buried in some quiet corner of the English
countryside. That wish alone entitled the tax man to a share of the
inheritance.and it can be a big one.
http://www.westminsterthailand.com/Articles/FM270.htm

As a matter of practice the following issues will often be
considered relevant:
..Ownership of property
.. A place on the electoral roll (but see Section 200, Finance Act 1996)
..The education of children
..Business interests
..The stated intention of the individual
..Burial plot
http://www.jordans-international.com/intapps/international3.nsf/main/issue+1
3?open

So lots of people think it's true. But strangely I couldn't find anything
from the Revenue. Probably because domicile is a question of common law and
not tax law.
 
M

Marshall Rice

As a testator's directions for disposal of his body aren't binding on
his personal representatives, why bother expressing them in the will
anyway? Why not simply come to a private arrangement?
 
J

John Pointon

Edward said:
I understand the taxman, most



It can be disagreeable to change domicility, for essentially it means you
are stating you have the intention never to return to the UK. You will not
be allowed to be buried in the UK when you die and you would also have to
cancel your membership of all UK-based organisations - such as the
much-coveted Marylebone Cricket Club (MCC).
http://money.guardian.co.uk/print/0,3858,4731020-110933,00.html

UK Domicile will be imposed :
If you retain assets in the UK or
If you keep a UK Passport, or
If you keep an interest in a property in the UK (i.e. a house or a holiday
home) or
You even express a wish to be buried in the UK
http://www.pacfinancial.com/articles/volume2_3.html

Change of domicile can be established by ownership and purchase of land,
opening and closing bank accounts, the amount of time spent in each country,
where one wishes to be buried and many other questions.
http://www.ukimmigration.co.uk/DOMICILEPOLYGAMYTALAQISLAMICMARRIAGES.htm

Expatriates have found clarifying domicile with the Revenue an
extraordinarily frustrating business. Exasperation sings loudly when they
are told one thing by advisers and another by the Revenue. Unfortunately, in
many cases, the Revenue will only declare its perception of domicile status
on the death of individual, taking the view that circumstances may change.
An individual could return to the UK after many years spent overseas, for
instance, or express a wish to be buried in the UK.
http://www.expatsdirect.com/ed/index.cfm?scn=featart&ArticleID=10

There have been many who have claimed a foreign domicile only to have
revealed a request that they be buried in some quiet corner of the English
countryside. That wish alone entitled the tax man to a share of the
inheritance.and it can be a big one.
http://www.westminsterthailand.com/Articles/FM270.htm

As a matter of practice the following issues will often be
considered relevant:
.Ownership of property
. A place on the electoral roll (but see Section 200, Finance Act 1996)
.The education of children
.Business interests
.The stated intention of the individual
.Burial plot
http://www.jordans-international.com/intapps/international3.nsf/main/issue+1
3?open

So lots of people think it's true. But strangely I couldn't find anything
from the Revenue. Probably because domicile is a question of common law and
not tax law.
This is an admirable summary of a complex subject which is based on a
plethora of case law and little statute. Hence, the silence on the topic
on the Revenue's part.



John Pointon
Accountant, Tax Consultant
"In business to grow your business"
 
E

Edward Lionheart

Marshall Rice said:
As a testator's directions for disposal of his body aren't binding on
his personal representatives, why bother expressing them in the will
anyway? Why not simply come to a private arrangement?
Excellent point, m' learned friend.
However, absence of clearly stated intent does not mean contrary intent,
especially if the corpse actually ends up planted in Blighty. The revenue
could reasonable infer that that was in fact the exact term of the private
arrangement!
However surely option 5 is unassailable.
5. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children ignore his "wishes" and have him buried with the wife
in the UK.

The children ignore his unenforceable publicly stated wishes and plead
ignorance of both the wishes and the supposed tax-consequences and carry out
his "secret" wish. I think the Revenue trying to tax a dead person on the
basis of a non-tax related "mistake" made by third parties after his death
would be laughed out of court.
The taxman would probably know he had been "had", but would just have to
grind his teeth. Disagree?
 
A

a0000000000

I would hate to point this out in your plans but:

1. You are quite correct in your assessment of the IHT position. If
domicile is determined to be UK then his worldwide estate would be taxable;
this also will not stop other juristictions determining that some part of
the estate is subject to local IHT or equivalent.

2. It is the executors who are responsible and liable to pay IHT on behalf
of the estate and are indemnified by the estate's assets. Anyone
responsible won't take a flier in this and will obain legal advice if not
straight-forward.

3. You cannot transport dead bodies around easily even when they are in ash
form. You need to have permits (even within the EU).

However, the the subject is a non-UK born, lived and died outside the UK,
held all his assets outside the UK and these are not for beneficiaries
inside the UK, it will be impossible for the IR to get their sticky fingers
on them even if they could argue domicile which I think on balance they
would lose. They more that those statements are not true, the greater the
weight of argument that they are UK domiciled. If the subject is UK born
and wishes to be buried here, he will be almost certainly be domiciled in
the UK, irrespective of his statements and acts during his lifetime.
 
J

Jim Lawton

snip
So lots of people think it's true. But strangely I couldn't find anything
from the Revenue. Probably because domicile is a question of common law and
not tax law.
Thank you, so it's clearly not b*ll*x, however, the whole problem of where you
are buried can be overcome by getting a fim grip on the idea that when you're
dead you're dead, and you *really* won't care.

What happens to your mortal remains you should leave to your relatives who will
say things like "s/he realy loved this piggery, we'll put the ashes in the
swill. It'll make them feel better, but I suspect you won't give a damn."

J
 
R

Ronald Raygun

Edward said:
However, absence of clearly stated intent does not mean contrary intent,
especially if the corpse actually ends up planted in Blighty. The revenue
could reasonable infer that that was in fact the exact term of the private
arrangement!
However surely option 5 is unassailable.
5. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children ignore his "wishes" and have him buried with the wife
in the UK.

The children ignore his unenforceable publicly stated wishes and plead
ignorance of both the wishes and the supposed tax-consequences and carry
out his "secret" wish. I think the Revenue trying to tax a dead person on
the basis of a non-tax related "mistake" made by third parties after his
death would be laughed out of court.
The taxman would probably know he had been "had", but would just have to
grind his teeth. Disagree?
Sounds good to me. If the children are pressed on the point and asked
why they buried him here, apparently contrary to his wishes, they can
always say it was because that way it would be more convenient for them
to visit his grave.
 
A

Anthony R. Gold

Suppose Mr.X has acquired a foreign domicile of choice but for
understandable sentimental reasons expresses the wish to be buried with his
late wife, who happens to be buried in the UK. I understand the taxman, most
unreasonably, might pounce and claim that Mr.X being buried in the UK
indicates that he never really acquired his domicile of choice, and hence
his worldwide estate is subject to UK IHT.
I don't see that being a serious risk. Domicile might be inferred from
the place where a person wishes to be living at the end of his life, when
viewed along with other indicators, but I know of no case where it was
inferred from the location to which someone wished his deceased remains
thereafter (i.e. posthumously) be transported and interred.

Tony
 
M

Marshall Rice

Edward said:
Excellent point, m' learned friend.
However, absence of clearly stated intent does not mean contrary intent,
especially if the corpse actually ends up planted in Blighty. The revenue
could reasonable infer that that was in fact the exact term of the private
arrangement!
Only if they know that there is one.
However surely option 5 is unassailable.
5. Mr. X states in his will that he wishes to be buried in his domicile of
choice. The children ignore his "wishes" and have him buried with the wife
in the UK.
Why complicate matters? The majority of testators don't express any
preference as to the disposal of the body. I think an arrangement such
as the one suggested may very well arouse suspicion.
The children ignore his unenforceable publicly stated wishes and plead
ignorance of both the wishes and the supposed tax-consequences and carry out
his "secret" wish. I think the Revenue trying to tax a dead person on the
basis of a non-tax related "mistake" made by third parties after his death
would be laughed out of court.
The taxman would probably know he had been "had", but would just have to
grind his teeth. Disagree?
I've never heard of the Inland Revenue taking the place of burial into
account when deciding issues of domicile. That isn't to say that it
doesn't happen, but if it does, I'd be surprised if it's ever a major
factor.
 
E

Edward Lionheart

Marshall Rice said:
Why complicate matters? The majority of testators don't express any
preference as to the disposal of the body. I think an arrangement such
as the one suggested may very well arouse suspicion.
I don't follow the logic. If the testator says nothing and ends up planted
here, it cannot be excluded that that was his intention. OTOH if he states
he wishes to be buried abroad, and his wishes are ignored, how can he be
held responsible(and taxable.) It may arouse suspicion, but that is Hector's
normal attitude anyhow. Suspicion is one thing, but proof is something
entirely different.
I've never heard of the Inland Revenue taking the place of burial into
account when deciding issues of domicile. That isn't to say that it
doesn't happen, but if it does, I'd be surprised if it's ever a major
factor.
Domicile is a matter of common law, not tax law.

Spence v Spence: A Jewish man with a Scots domicile of origin moved to
Spain. He was registered as married in Spain and had two children there. The
marriage subsequently broke down but at the time of proceedings he had
another girlfriend there. Held that had not obtained Spanish domicile of
choice, Scots domicile of origin persisted. 1) Social circle consisted
mainly of British(in particular Scots) friends 2) Onus is on party averring
a change of domicile to establish it 3) Illustrates lairs or burial
instructions but this was not decisive in this case(He had resigned
membership of Glasgow burial society).

Ramsay v Liverpool Royal Infirmary:(H of L)Lord Buckmaster, Viscount
Dunedin, Lord MacMillan; Validity of wil depended on Scots or Eng dom. Scots
dom of origin. Resided in Glasgow for long period, had retained property in
Glasgow but had no wish to return. He had lived in isolation and not entered
into life of the place, he had retained a subscription to a weekly Glasgow
newspaper. Did not return even for mother's funeral and made arrangements
for own burial in Liverpool. Will declared "a Glasgow man'.Held no intent to
acquire new dom of choice so dom of origin persisted.

Brown v Brown: There is a duty on the legal representatives to inform the
court of all the relevant circumstances pertaining to domicile.

Drevon v Drevon: Even the smallest factors can be relevant in determining a
parties domicile.

Taking the above sample of cases, it seems clear that burial intentions
*could* be decisive.
 
A

Anthony R. Gold

Taking the above sample of cases, it seems clear that burial intentions
*could* be decisive.
The only one of your examples that even mentions burial intentions states
that the individual concerned was found never to have acquired a domicile
of choice, whereas you state that the Mr. X in your original situation HAD
acquired a foreign domicile of choice.

Nothing you have quoted could lead one to the conclusion that mere burial
intentions are sufficient to change someone's domicile.

Tony
 
E

Edward Lionheart

Anthony R. Gold said:
The only one of your examples that even mentions burial intentions states
that the individual concerned was found never to have acquired a domicile
of choice, whereas you state that the Mr. X in your original situation HAD
acquired a foreign domicile of choice.

Nothing you have quoted could lead one to the conclusion that mere burial
intentions are sufficient to change someone's domicile.
Eh?
(i.) Domicile is a matter to be decided by the courts.
(ii.) The courts have held that burial intentions is one factor to be
considered, and even the smallest factor can be decisive.
(iii.) When I say Mr.X has acquired a foreign domicile of choice, that is
implicitly subject to (i).
(iv.) Therefore Mr.X and his heirs need to consider carefully (ii) in the
light of (i).

How can you suggest otherwise?
 
A

Anthony R. Gold

Eh?
(i.) Domicile is a matter to be decided by the courts.
(ii.) The courts have held that burial intentions is one factor to be
considered, and even the smallest factor can be decisive.
(iii.) When I say Mr.X has acquired a foreign domicile of choice, that is
implicitly subject to (i).
(iv.) Therefore Mr.X and his heirs need to consider carefully (ii) in the
light of (i).

How can you suggest otherwise?
Your original post explicitly stated that we were to "Suppose Mr.X has
acquired a foreign domicile of choice"

If you now wish to argue against your own original premise, may I suggest
you take this thread to email with yourself :)

Tony
 
E

Edward Lionheart

Anthony R. Gold said:
Your original post explicitly stated that we were to "Suppose Mr.X has
acquired a foreign domicile of choice"
Your responses ignore one thing;
It is possible to lose a domicile of choice as well as to gain one, and the
former is very much easier than the latter.
If you now wish to argue against your own original premise, may I suggest
you take this thread to email with yourself :)
Don't respond to threads you don't understand.
 
A

Anthony R. Gold

Your responses ignore one thing;
It is possible to lose a domicile of choice as well as to gain one, and the
former is very much easier than the latter.
I thought that any change in domicile would normally involve both one gain
and one loss. But if I got that wrong, and if what you say is true, then
there must also be an ever-growing number of domicile-less people.

Tony
 
E

Edward Lionheart

Anthony R. Gold said:
I thought that any change in domicile would normally involve both one gain
and one loss. But if I got that wrong, and if what you say is true, then
there must also be an ever-growing number of domicile-less people.
Nope.
Under English law you are born with a dom of origin (father's dom unless
illegit, then mother's)
You may (with difficulty) acquire a dom of choice elsewhere.
If you lose that dom of choice without acquiring(with difficulty) another,
your English dom of origin automatically revives.

eg. man with English dom of origin acquires a New York State dom of choice
and lives there 50 years. Decides to end his days in sunny California. Dies
on the way there. He will die domiciled in England.

Since it is virtually impossible to get a Inland Revenue ruling on your
domicile until after you are dead, the sensible thing to do is to nail as
many issues as you can which may be used by the IR to claim you never really
acquired your supposed dom of choice. Burial / burial instructions may be
one of those issues.
 
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D

Doug Ramage

Edward Lionheart said:
Since it is virtually impossible to get a Inland Revenue ruling on your
domicile until after you are dead, the sensible thing to do is to nail as
many issues as you can which may be used by the IR to claim you never really
acquired your supposed dom of choice. Burial / burial instructions may be
one of those issues.
Not so. Domicile rulings can be necessary where the remittance basis applies
in respect of IT and CGT - including foreign emoluments for Schedule E.
 

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